JOURNALIST ASKING MIKE GALLAGHER: "Mike, support from central banks, PBOC and BOJ as well. Reassuring words from the BOJ, no?"

MIKE GALLAGHER: "Absolutely. I think the market looked at yesterday's minutes and took away the sense that there's a growing debate about easing additionally into the spring. If we don't really sort of get momentum continuing in the economy. And there's a little bit of apprehension in that direction. So the market are looking for more liquidity from the Bank of Japan. The PBOC has been successful in the end in calming some of the rate jitters that existed before Christmas. And I think in terms of the Fed, there's a sense that the taper will be slow. And that's why you've got this trend of both the gentle drift upwards in US yields but also equities remaining buoyant as people look at the continued ongoing liquidity."

JOURNALIST: "Yeah. Last time we hit 3% on the 10-year. That spooked equity markets. Do you expect that to happen this time? I mean we've already hit the 3% of course. But how hard are we going to go in and when will equity markets be spooked?"

MIKE GALLAGHER: "I think we're looking for a move to 3.25%. The critical issue is the pace that that arrives. We see that 3.25% taking around about two months or so in early 2014 and that's not a particularly fast pace. And I think if it's that kind of pace, then we could see this continued divergence in terms of price action. I think ultimately equities start to get a bit of a reality check once we get into the spring and then people start debating what's going to come after taper. And I think then you could see equities running into a bit more of a difficult phase in the U S certainly."

JOURNALIST: "We talked about Japan, but this progress towards 2%, how tough is it going to be given the weaker Yen?"

MIKE GALLAGHER: "Well I think the difficult part is getting it from 1% to 2% really. If you look at what Kuroda has said, it's 2% on a sustainable basis. So it's not just hitting 2% and that's it. So I think we very much are of the view that the Bank of Japan will have to take extra action to try and ensure that it does meet the target on a sustainable view. So we're looking for the BOJ to ease policy in April. That's going to be Yen negative. We still got the view of 110 on Dollar/Yen by the spring."